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Budget Highlights

To: Deans and Chancellor's Cabinet
From: Jeff Maples, Intermin Vice Chancellor, Finance and Administration
Subject: Budget Highlights
Date: April 6, 2009

As you are aware, the State of Tennessee is to be a recipient of the federal stimulus monies.  Once the General Assembly passes and the Governor signs the budget for FY 2009-10, the State and Federal stimulus funds will be allocated to the University in accordance with the appropriations bill.  That is the good news.  The bad news is these funds must be scrutinized, subject to audit and quarterly reports required on a short turn around basis.  Therefore it is imperative that the funds be spent according to the restrictions on the stimulus funds. 

Our Budget

The proposed campus-wide budget reduction of 13.9 percent ($25,594,000) will be deducted from the FY 2010 base budget as planned.  However, this reduction will be added back but be added back as a stimulus non-recurring amount.

The FY 2009-10 E&G total budget will consist of a reduced base budget plus a stimulus non-recurring budget amount.

In general, the following stipulations apply to the use of stimulus funds:

    • No funds may be used toward salary increases or a one-time bonus.
    • Funds may not be used for capital outlay.
    • Funds may not be used for auxiliary enterprises.
    • Funds may be used on an exception bases for modernization, renovation, or repair of facilities that are primarily used for instruction or research - requests for exceptions must include an analysis or projected savings of recurring expenses and how the project enhances the institution’s mission and goals.
    • Requests for modernization, renovation, or repair projects must follow normal procedures and policies as set forth by THEC and the State Building Commission.
    • New cost centers are being established for each college and administrative unit.  This is necessary to comply with reporting requirements.  These costs centers will be labeled ARRA-____.

All stimulus funds allocated to the units must be spent or encumbered by June 30, 2011.

Restrictions associated with stimulus funds should limit transactions only to payroll entries (salaries and benefits), invoices to vendors, and direct charges from other University departments such as motor pool and the Bookstore.   Therefore, salary TV’s and transfers that move charges from their original postings to ARAA-stimulus cost centers should not occur.  It is strongly encouraged to not allow automated recurring transactions (such as telephone charges) on the stimulus funds as it could be problematic to clean up after two years.  Overspent funds on stimulus cost centers will be transferred to the departmental account.

Specific detail of the budget process will be distributed to the fiscal officers on Monday April 6. 

Posted April 13, 2009